Downtown Tampa and Brandon, Florida

Is an Architect's Cost Estimate Binding?
 

An owner who signed a letter of intent to proceed with construction knowing that the construction cost would exceed the architect's Statement of Probable Cost had no claim against the architect.

The owner and architect entered into a "Standard Form of Agreement Between Owner and Architect." The architect gave the owner a Statement of Probable Cost, estimating the cost of the proposed project to be $5,020,025. But when the owner received bids for construction, the cost ballooned to over seven million dollars. The owner sued the architect claiming that the architect breached the contract.  But by entering a letter of intent to proceed with the project after being fully apprized of the additional cost of the project, the owner could not claim the architect breached any obligation under the Statement of Probable Cost.

SCHAPIRO AIA & Associates v. RUBINSON, 2000 WL 1629404 (Fla.App. 3 Dist Nov. 1, 2000.

Tip:

Contract rights may be waived by conduct that approves of proceeding with construction or other contract obligations in a manner that is directly inconsistent with the duties of  the other other party.  You can waive contract rights by actions that show you consent to a modification of your rights under a contract. 

Can You Lose Sunshine Law Rights?

The Florida Sunshine Law requires that all public meetings be open to the public. But your inaction might actually cause you to lose your rights and allow government staff members to hold closed meetings, without notice, and without keeping minutes of the meeting.

Tip: 

When dealing with governmental agencies, advise the public entity in writing at the earliest possible stage if it is foreseeable that you might submit any application or request that will have to be approved by any body that is subject to the Florida Sunshine Law. With such notice, some otherwise closed staff meetings may become subject to the Sunshine Law.

Discussion of Law

The Florida Sunshine Law was enacted to give the public access to meetings held by state and local public entities. The Sunshine law imposes three obligations of openness:

First, the meeting must be properly noticed (proper notice depends on the circumstances);

Second, the public must be allowed to attend the meeting; and

Third, minutes of the meeting must be prepared. (The minutes are public records and can be obtained by making a public records request).

Meetings are open because of the Sunshine Law, public records are open because of the Public Records law. You can tell if someone is unfamiliar with this distinction when you hear, "I will be able to get a copy of that document because of the Sunshine Law."

The application of the Sunshine Law is easier to apply when dealing with the elected body of a governmental entity, such as a board of county commissioners, or a city council, or the board of a special district. When two or more of those members meet to discuss a matter that may foreseeably come before the governing board, the meeting must be noticed, the public must be allowed to attend, and there must be minutes prepared.

The Sunshine Law also applies to committees or groups created by a public entity that is subject to the Sunshine Law. This was intended to prevent the governing boards from creating closed committees that narrow decisions for the governing board. Instead, the law is clear that if an entity that is subject to the Sunshine Law moves any of its decision-making process to a committee, that committee is also subject to the Sunshine Law. This illustrates the key purpose of the Sunshine Law: to allow the public to observe each preliminary step leading to the final decision.

But what about staff meetings? Generally all staff activities including their meetings are not subject to the Sunshine Law. However sometimes activities of staff are subject to the Sunshine Law if a staff committee or group:

1. Is designated by the governing board, and

2. Is engaged in more than fact-finding activities.

In other words a board-created committee that only gathers facts and presents those facts to the governing board is not subject to the Sunshine Law. If a committee does not make any recommendations, does not perform any screening activities, and only gathers facts, the committee is called an advisory committee under the Sunshine Law. Of course, merely calling a committee an "advisory" committee will not remove the committee from the Sunshine Law. If the committee makes any decisions, recommendations, or provides any decision-analysis of the facts, the staff committee is subject to the Sunshine Law regardless of its name.

When the chairperson of a staff committee that is subject to the Sunshine Law schedules a meeting, it is clear that the Sunshine Law applies. The committee meetings are subject to the Sunshine Law.

But what about a meeting between two staff members who are on such a Sunshine Law staff committee? Just as a lunch meeting between two city council members to discuss public business is subject to the Sunshine Law, meetings between two staff members who serve on a Sunshine Law staff committee are also subject to the Sunshine Law if they discuss matters that may foreseeably come before the staff committee.

While it is relatively easy for the elected or appointed members of governing boards to notice any meetings at which they will discuss public business, staff members have constant communication with one another and often work side by side. Thus, there are more situations in which two staff members who are on a Sunshine Law committee will face the issue of whether their conversations are actually Sunshine Law meetings because they are talking about something that will be discussed by the full committee. If their discussions do relate to the business of the committee, their mini-meeting is subject to proper notice, public attendance, and minute taking.

A Sunshine Law issue was faced by staff members of Lake County in a recent case. 

It was the "Case of Reluctant Excavator."  In this case, a citizen had been issued a notice of violation for excavating on his property without a permit. The County's procedures required a permit for such activities and when someone submits a completed application and the proper fees, the matter is reviewed by a Sunshine Law committee created by the Lake County Commission.

The Lake County Board of County Commissioners created a Technical Review Committee ("TRC"). The TRC's composition and function is described in the Lake County Code:

"Membership. The Technical Review Committee is comprised of the following: County Manager or designee(s), Lake County Sheriff, School District of Lake County, Water Authority, Lake County Health Department, Public Utilities and other representatives deemed appropriate by the County Manager or designee.

"Powers and Duties. The Technical Review Committee is advisory to the County Manager or designee in the following:

Preliminary Subdivision Plats Planned Unit Developments MUQD's DRI's FQD's Comprehensive Plan Amendments Conditional Use Permits Rezoning Site Plans Master Park Plans."

However, prior to meetings of the TRC, some county staff members would meet to discuss various matters. The issue in the resent case was whether these pre-TRC meetings were also subject to the Sunshine Law.

The citizen who was excavating without a permit knew that he would have to apply and submit a site plan that would be reviewed by the TRC. In fact, the citizen had even submitted a sketch of his plans, but apparently the citizen was reluctant to actually tell the County that he would in fact submit an application. The reluctant excavator's sketch did not rise to the formality of what Lake County required for a site plan application.

While these preliminary actions were being taken by the citizen who was moving closer and closer into asking the County to review and permit his activities, Lake County staff members talked about the citizen's excavation at a pre-TRC meeting.

Eventually the citizen did submit a complete application for an excavation permit to the County. But the citizen sued Lake County claiming that Lake County violated the Sunshine Law when staff members who were on the TRC met and talked about his property prior to the time he had submitted a full application. While the County had issued a notice of violation to the excavator and had received a sketch, the staff did not follow the Sunshine Law when a few members of the TRC met in the pre-TRC meetings and had some discussions about the excavator's land.

Those mini-meetings turned into a large lawsuit.

Essentially the question before the court boiled down to this: when some of the TRC members have an informal meeting to discuss TRC business, does that meeting have to be noticed? When are mini meetings subject to the Sunshine Law?

For example, when one staff member stops another staff member in the hall to ask about an application that was submitted for review, does the hallway meeting need to be noticed in the local newspaper? What about when committee members meet and just mention a citizen's property? What about when staff members have planned meetings to discuss how they should handle a situation before the full committee?

In the specific Lake County situation involving a Technical Review Committee, the court used a two-factor analysis to determine if a mini meeting (a meeting between two or more committee members outside a scheduled TRC meeting) is subject to the Sunshine Law.

First, the court considered whether the staff members had been given any recommending or screening authority by the full committee. If they did have such authority (as delegated by the full committee or the governing body) the court seems to imply that the meeting is subject to the Sunshine Law regardless of the specific topics discussed so long as the meeting is in furtherance of TRC business.

In the recent case involving Lake County, the court found that the county's staff members had no authority to act or make decisions as part of the full TRC's decision-making process. The court recognized that when such mini meetings are among committee members who do not have any authority to act, the meetings fit within the "fact-finding-advisory-committee" exception: if a group functions solely as a fact-finding body without any authority to make recommendations, then the group is not subject to the Sunshine Law.

Second, the court considered the factor of whether the staff members could reasonably foresee that the matters they were discussing might be discussed by the full TRC. If the staff members could reasonably foresee that they were discussing at a pre-TRC meeting might also be discussed at the full TRC meeting, then the mini meeting was subject to the Sunshine Law.

Although the reluctant excavator had been cited for a violation, and was told that he could apply for a permit, and had submitted a sketch of his site, and had his property mentioned by staff at a pre-TRC meeting, the court held that those facts were insufficient to prove that the staff members could reasonably foresee that the citizen might submit an application to the TRC. Therefore, the mini meetings were not subject to the Sunshine Law.

CONCLUSION:

It seems clear by the court's reasoning that if the citizen (the reluctant excavator) had given written notice along with his preliminary sketch that he might submit an application in the future, the pre-TRC meetings would have been subject to the Sunshine Law. This is because the members could have foreseen that the citizen's excavation problems might be considered by the TRC.

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Fictitious Names

When you are in business as a sole proprietorship (not incorporated) you may use your first and last name (your legal name) as the name of your business, for example, if your name was Sally Glass you could do business as "Sally Glass Diamonds" without having to register the name as a fictitious name.  But if you operated your diamond business under just your last name and called your business "Glass Diamonds," the state of Florida requires registration of  "Glass Diamonds" as a fictitious name.   

Corporations:

The same principle applies to corporations.   A corporation gets its name when it is incorporated.  The name is on the articles of incorporation.  So long as the corporation does business under that name, the corporation does not need to register as a fictitious name. But if a corporation named "Glass Diamonds, Inc." began using the name "The Original Sally Glass Diamonds" the corporation would need to register its fictitious name with the state.

Read the Fictitious Name Law.

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Venue

Do your contracts or P.O.s specify where a lawsuit or arbitration must be brought if there is a dispute?   

If you do business throughout the nation or even throughout Florida, would it be a hardship to have to defend a lawsuit filed in another state or in another county in Florida by one of your customers?  Most businesses say "yes."  That is why it is a prudent business practice to state in your contracts or purchase orders the venue for any action or arbitration.  

When a business is located only in Pinellas County, FL, for example, and makes its product in Pinellas County and signs its contracts in Pinellas County and has its customers send payments to Pinellas County, there are few instances in which a court would not enforce a clause in your contracts and P.O.s stating that venue will be in Pinellas County even if your customer is located in Tallahassee. 

Of course, when there are multiple locations of your business or place of manufacture, the rules for venue permit a court to disregard the venue specified in the contract or P.O. when that location has no relation in fact to the actual places where the contract was made or performed.   

However, for most business transactions venue is a matter of common sense and common sense also should guide you to include a venue clause in all your contracts and P.O.s

Covenants not to Compete

Covenants not to compete are contracts between employers and employees restricting the right of the employee to engage in a competing business.

Covenants not to compete are valid, but businesses can not enforce them unless they are written in accordance with the law.

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